When computing the amount of interest cost to be capitalized, the concept of avo

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When computing the amount of interest cost to be capitalized, the concept of avoidable interest' refers to a. the total interest cost actually incurred b. a cost of capital charge for stockholders equity c, that portion of total interest cost which would not have been incurred if expenditures for asset construction had rot been made d. that portion of average accumulated expenditures on which no interest cost was incurred riod of time during which interest must be capitalized ends when The per a. the asset is substantially complete and ready for its intended use b, no further interest cost is being incurred c, the asset is abandoned, sold, or fully depreciated d. the activities that are necessary to get the asset ready for its intended use have begun. What is consigned inventory? a. Goods that are shipped, but title transfers to the receiver b. Goods that are sold, but payment is not required until the goods are sold c. Goods that are shipped, but title remains with the shipper d. Goods that have been segregated for shipment to a customer . Which inventory costing method most closely approximates current cost for each of the following FIFO FIFO LIFO LIFO a. b. Ll FIFO LIFO 11, Mooney Corporation purchased for $1,710,000 a tract of land on which was located a warehouse and office building. The following data were collected concerning the property ed Valuation Vendor's Original Cost Land Warehouse Office building $560,000 360,000 680,000 51.800,000 the land, warehouse What are the appropriate amounts that Mooney should record for and office building, respectively? a. Land, $560,000; warehouse, $360,000: office building, $680,000 b. Land, $600,000; warehouse, $400,000; office building, $800,000 c. Land, $598,500; warehouse, $384,750; office building, $363,375 contracts should be accounted for at Plant assets purchased on long-term credit a. the total value of the future payments. b. the future amount of the future payments c. the present value of the future payments. 20. d. none of these. hen a plant asset is acquired by issuance of common stock, the cost of the plant asset is properly measured by the 21. W

Explanation / Answer

Question Answer 15 (c) that portion of total interest cost which would not have been incurred if expenditures for asset construction had not been made 16 (a) the asset is substantially complete and ready for its intended use 17 (c) Goods that are shipped, but title remains with the shipper 18 (b) Ending Inventory = FIFO and Cost of Goods Sild = LIFO 19 (d) land: 60/180 X 1710000 = 570000 ; Warehouse: 40/180 X 1710000 = 380000 ; Office Building: 80/180 X 1710000 = 760000 20 (c) the present value of the future payments

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